Pioneer Natural Resources Co. (NYSE: PXD) received the second and final $500 million payment for its stake in EFS Midstream LLC—the company's Eagle Ford Shale midstream business.
In June 2015, Pioneer cashed in its 50.1% interest in the Eagle Ford midstream business. The buyer, Enterprise Products Partners LP (NYSE: EPD), agreed to pay $1,030 million after debt repayment for the assets.
As part of the deal, Pioneer will receive fee reductions from Enterprise under existing downstream processing and transportation contracts in exchange for extending the contract term to 20 years and dedicating additional Eagle Ford Shale volumes to Enterprise.
RELATED: Pioneer Cashes In Eagle Ford Midstream For Permian Horizontal
Pioneer expects to use the sale proceeds for general corporate purposes, including funding of the drilling program across its extensive acreage position in the Spraberry/Wolfcamp Play in the Permian Basin of West Texas.
After the final payment, Enterprise has consolidated liquidity of about $4 billion. The company's liquidity is comprised of unrestricted cash on hand and available borrowing capacity under its $4 billion multi-year revolving credit facility and $1.5 billion 364-day credit facility.
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